rbynaker
Level 13

@Just-Lisa-Now- wrote:

So Ive got one with a Covid distribution that figured they'd just bite the bullet and pay the tax on all of it this year, why prolong the pain, BUT they also have UI...so if they spread it out over 3 years their income squeaks in just under the 150k mark and they can exclude the $10,200, so that's saving another 3k if they spread it out that distribution.


And who says tax planning ends at 12/31!?!  Remember anyone with a COVID related retirement distribution can also choose to repay all or part of the distribution.  So if you run into somebody just over the $150K AGI number they could be in a situation where repaying $2K to their IRA saves them $3K in tax.